The bank receives specific instructions from the investor to invest in a particular Shariah-compliant business, under which the funds are not pooled in the funds` general investment pool. The funds are deposited in a specific investment account in which the bank invests the funds in instruments identified by the investor in accordance with the instructions or the investment agreement. could be types of Mudaharaba fixed silver. expression, when to say what year. Short and long If a Mudaraba contract is used as a source of bank funds (when the customer pays money to the bank), it is the unrestricted Mudaraba that is most often used. If the contract supports a bank`s financial equity proceeds (when the bank makes funds available to a working partner), Mudaraba Limited is most often involved. The term refers to a form of business contract in which one party contributes capital and the other personal effort. The share of profits on a pro rata basis is fixed by mutual agreement. But the loss, if at all, is borne only by the owner of the capital, in which case the entrepreneur receives nothing for his work. The financier is known as “rabal-maal” and the entrepreneur as “mudarib”.

As a financing engineering taken over by Islamic banks, it is a contract in which the entire capital is provided by the Islamic bank, while the operation is managed by the other party. The profit is divided under pre-agreed terms and the loss, if it exists, unless it was caused by negligence or breach of the contractual conditions by the “Mudarib”, is borne by the Islamic bank. The bank passes this loss on to depositors. The $1 million capital will be returned to the original investor with 60 percent of the bank`s profits from the second contract. ($350,000 x 60 percent equals $210,000) The bank holds the remaining 40% of $350,000, or $140,000. Thus, the bank earns 140,000 $US if it acts as an intermediary between the depositor and the entrepreneur. The investor grants the bank the freedom to invest in any Shariah-compliant investment, as it appears in shape and normally in the business route. The funds are paid into a general investment account pool that is used by the bank to manage the funds as long as the investment is made in the best interest of the investor. The Mudaraba contract is applied when someone pays money into an Islamic bank, waiting to get a return. In most cases, the contract applied is a first animal (or simple) Mudaraba contract, i.e.

only the customer and the bank are involved. (The Bank serves as the fund manager for the money paid.) So the application to the Wakalah treaty more than Mudarabah? And why is the use of Mudarabah in financial institutions decreasing? Is it because of the risk? Thank you again. It is an agreement between two parties: one that provides “100% of the capital” to the project and another party known as “Mudarib” and that leads the project with its entrepreneurial skills. The profits generated by the project are distributed according to a predefined ratio. The losses incurred are the responsibility of the investor. The investor has no control over the management of the project. What is the use of Mudarabah Funds, short-term investments? A – It is legitimate to transfer Mudarabah contracts in the light of the legal principle that the partner agent may be used in Mudarabah transactions under the following conditions: 1. The usual method is the daily monthly provision, which has the same effect as a calculation of the daily monthly average.

We ran every day based on the actual amount……